Exam 8: Planning Advertising and Integrated Brand Promotion

A young man heads the marketing team for a national electronics retailer.He has before him the task of drafting the ad plan for the company.From a long list of situational factors, which is probably the single most important one for him to consider?

Scenario 8-2 Following the announcement that the world's largest e-tailer, Amazon.com, made a profit for the first time since it started business in the early 1990s, the company saw more than 90 percent of its market value disappear as part of the dot-com collapse.It is questionable whether or not Amazon figured out a profitable business model after changing its tune several times over those early years.Then it began circling back somewhat to an earlier focus on becoming the Walmart of the Internet.It said it wanted to sell huge volumes of merchandise cheaply, and in the process eke out enough of a profit to satisfy Wall Street.Although investors had to wait some time for the e-tailer to work out the kinks, and it's uncertain how much longer they'll remain patient, Amazon's mainstay retail business may see further improvements as it grows.As we all have now witnessed, unlike brick-and-mortar retailers who must build new stores, stock them, and hire people to staff them, Amazon has been able to open new stores with minimal additional cost.Some years ago, it reported turning over its inventory 17 times a year-close to double that of traditional retailers at the time.And on average, it reported having gotten paid 32 days before it must pay its suppliers-in essence, providing millions of dollars in cash flow.Information updated for 2011, based on the following initial articles: (David Shook, "Can Amazon Turn Baby Steps Into Strides?," Businessweek Online, February 13, 2002.) (Rob Hof, "Why Amazon Could Keep Flowing," Businessweek Online, January 5, 2005.) -(Scenario 8-2) When dealing with its advertising agency, Amazon wants a strategy that maximizes media expenditures to target the appropriate markets.It is Amazon's primary responsibility to bring forth a well-articulated statement of the brand's _____, a key concept in reaching and informing the customer through promotion.

What is probably the most agonizing task to be done during an advertising effort?

A marketer at a large advertising agency has been assigned the task of developing advertising objectives for a nationally known brand of orange juice called Sweet Sunshine.What are the advantages of viewing the advertising effort from strictly a communications viewpoint, as opposed to a sales objectives viewpoint? Regardless of which viewpoint is ultimately adopted, what characteristics should the objectives display to allow the Sweet Sunshine client to make intelligent decisions about resource allocation?

Scenario 8-3 After working as an account executive in an advertising agency for 20 years, you've decided to chuck it all and be your own boss.You buy a neighborhood hardware store from a man who has owned and run the business for the past 52 years-Springfield Hardware.He sells the store and all the inventory, with one warning-he wasn't much on paperwork, so there won't be a lot of records to be found.You hand him a cashier's check, and he leaves without looking back.He heads to a vacation at a Club Med, and you head to an office that hasn't been cleaned in 52 years to create your ad plan. -(Scenario 8-3) Your goals are very important at this stage, and you want to avoid budgeting methods that neglect to consider goals.This means that you can cross off one approach that is notorious for failing to relate advertising dollars to advertising objectives.And since you have no past records, this method would be impossible to implement anyway.Which one is it?

What is the first step in implementing the objective-and-task approach?

The account planner at an Indianapolis ad agency has done a survey and found that a significant percentage of people already recognize the name of the cold remedy his firm is about to advertise.When consumers know that a brand exists and recall its name to some degree, they are demonstrating

The situation analysis of an advertising plan includes historical context as well as evaluation of the industry, the market, and the competition.

What does the objectives section of an advertising plan do?

In theory, of the major options for advertising objectives, ____ asks the least of consumers and ____ demands the most.

Scenario 8-5 Helene Curtis is preparing to introduce a new brand of all-natural-ingredient shampoo into the market in several months.In test marketing, many consumers liked the product but their comments indicated that it is different enough from existing brands that significant promotion and information will be needed to convince them to switch from their current brands.Helene Curtis has always used an objective-and-task approach to develop advertising budgets.Due to these research results, the firm must now do a detailed build-up analysis. -(Scenario 8-5) Helene Curtis has once again decided to use objective-and-task budgeting to set the advertising expenditures.This is the only budgeting method that focuses specifically on advertising spending

Regarding the relationship between the client and agency, things will go most smoothly and efficiently when

The ways in which the creative objectives will be accomplished are described in the

A frozen dessert manufacturer wants to see an increase in consumers who say they do plan on buying desserts at one of its outlets soon, so the manufacturer sets this as its objective in the ad plan.In doing so, the underlying assumption here is that purchase intent is

An advertising agency may take an active role in helping the client formulate the marketing plan.

An advertising plan is designed to create sales strategies for the client in a process that is totally separate from the overall marketing plan.

Scenario 8-5 Helene Curtis is preparing to introduce a new brand of all-natural-ingredient shampoo into the market in several months.In test marketing, many consumers liked the product but their comments indicated that it is different enough from existing brands that significant promotion and information will be needed to convince them to switch from their current brands.Helene Curtis has always used an objective-and-task approach to develop advertising budgets.Due to these research results, the firm must now do a detailed build-up analysis. -(Scenario 8-5) Which element of the build-up analysis will identify the demographic and geographic exposure that the advertising for the shampoo hopes to achieve?

Setting an advertising budget based on the percentage-of-sales approach sounds simple, but it is full of problems.

The method of budget setting that focuses on the relationship between spending and advertising objectives is the margin-analysis approach.

Share of voice has its problems, but is most often used when launching new products.